Germany's government has reached an agreement in principle with utilities on a nuclear decommissioning pact that could go into effect in February, Bloomberg reports.

Utilities including E.ON (OTCQX:EONGY) and RWE (OTCPK:RWEOY) reportedly would make a combined initial payment of €23.3B ($25.8B) that was proposed by a government appointed panel in April, as well as interest, to free them from their nuclear waste storage liabilities.

The German cabinet is expected to approve the deal on Oct. 19, according to the report.

RWE (OTCPK:RWEOY) could consider pulling out of Britain if it fails to turn around the business, which has swung to a loss after billing problems and a rapid loss of customers, CFO Bernhard Guenther tells Reuters.

RWE said last week it has lost ~200K customers in Britain YTD, sending its shares down 10%; it now has 5.4M customers in the U.K.

Guenther says it would take at least until 2017 for RWE's Npower U.K. unit to return to profit from an expected mid double-digit million-euro loss this year.

The results remove concerns that utilities may need to raise additional funding to pay for the dismantling process as well as the storage of nuclear waste, which had led investors to sell off German utility stocks in recent weeks.

Several brokerages, including Deutsche Bank, Credit Suisse and Societe Generale, either upgraded their ratings or target prices on the utilities.

In another positive for utilities, power providers will be compensated if they participated in a new "capacity reserve" system where brown coal plants can be switched back on if there are power shortages.

The plans are welcomed by industry but condemned by environmental groups which accuse Chancellor Merkel of selling out to business interests.

Industry had warned a coal levy could put up to 100K jobs at risk, and risked pushing coal-fired power generation into other European countries.

Mikhail Fridman reportedly is preparing to sell his recently purchased North Sea gas fields, bowing to British threats to revoke the licenses for the assets unless the Russian billionaire relinquishes ownership.

Fridman took ownership of the 13 gas fields in the U.K. North Sea as part of its purchase of Dea, RWE's (OTCPK:RWEOY) oil and gas unit, for €5.1B, but in February the U.K. government said it would block the deal on concerns about the impact of any future potential sanctions on Russia might have on the operation of the North Sea fields.

Morgan Stanley is said to be advising the sale, which is expected to fetch a total of up to $1B (£656M).

RWE and Fridman are going ahead with the sale even as the U.K.'s energy regulator says it will not approve the sale of British North Sea natural gas fields, which form ~20% of the Dea transaction and represent 3%-5% of U.K. domestic gas output, on concerns that Fridman could be a target of sanctions that could result in the fields’ shutdown at a time when British gas output is declining.

LetterOne also names fromer BP CEO John Browne, a member of the U.K.’s House of Lords, to lead its energy unit.

RWE (OTCPK:RWEOY+3.5%) agrees to sell its Dea oil and gas unit to a group of Russian investors by early March for €5B ($5.81B), €100M less than previously agreed to reflect the fall in oil prices.

U.K. authorities have been hesitant to give their approval for the deal out of concerns that potential sanctions on the Russian buyers could endanger the unit's operations in the North Sea; in the revised transaction, RWE says the Russian group would now keep Dea's U.K. activities separate from the rest of the company's business for a number of years.

The Dea sale is part of RWE's efforts to cut its €31B debt and would be booked in 2015.

Repsol leads a consortium including Australia's Woodside Petroleum (OTCPK:WOPEF, OTCPK:WOPEY) and Germany's RWE (OTCPK:RWEOY) that planned to spend $350M on exploration in the area.

The Spanish company had forecast long-term yields of 110K bbl/day of oil from the project, enough to cover ~10% of Spain’s oil consumption; a major discovery could have reduced Spain’s 99% reliance on energy imports.

Germany's RWE (OTCPK:RWEOY) is seeking further cost cuts in its conventional power generation business as it continues to fight difficult market conditions, local media are reporting.

The current savings target for its austerity program is at €800M ($1.03B), which reportedly will be raised by several hundred million euros.

Like other European utilities, RWE has been struggling with excess power generation capacity as subsidized wind farms and solar plants have come on stream, plus poor energy demand in the weak European economy, have eroded power prices and dragged down earnings.

RWE says the latest plant closures would remove 1 GW of capacity from the German market, bringing overall capacity coming offline to nearly 6.3 GW by the end of 2017; the company also has ended power purchase agreements with other utilities with a total capacity of 2.7 GW.

The impact of the policies was felt in RWE's H1 results, announced today: Net profit excluding one-time items such as asset sales fell 62% Y/Y to €749M, on a 10% decline in revenue to €25.1B.